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When companies like Tesla sells bonds, where would you buy them from? And how would you know about them being made available? (Often seems to be that once it h

When companies like Tesla sells bonds, where would you buy them from? And how would you know about them being made available? (Often seems to be that once it hits the news it's all over)

joshmlewis 13y ago
Is it something you have to be an accredited investor for?
- hkmurakami 13y ago
  No, you can be a regular investor but you need to have an account through a major bank and have someone you can talk to who can show you their new issue inventory and make the transaction for you.
- lemma 13y ago
  You don't need to be accredited. The debt of a company is higher in the capital structure than its equity (creditors come before shareholders in bankruptcy), so it's a more conservative investment. That's not to say that any bond is safer than any stock, and there are plenty of bonds that are very risky (companies have credit ratings just like individuals and countries). Keep in mind also that bonds tend to have a minimum purchase size (usually $10k face value) and minimum increments thereafter ($1k usually).
hkmurakami 13y ago
Your broker at a major bank is the only place where you'd be able to buy a new offering of bonds. There's usually some minimum quantity you have to buy, in the range of $30k-$100k minimum. You basically have to ask said broker to tell you when they're available. (give you the list of new issues periodically) I think you can buy existing bonds on the market through more normal channels including discount brokerages. edit: Public Service Announcement - don't trade in bonds, because you're virtually guaranteed to get taken advantage of hardcore by Wall Street bond traders, even the "flow traders" that do the transaction for you. One example is the broker giving you a price (via the trader) that reflects the bank's own book instead of the actual open bond market (you can check the discrepancy by demanding to see the Bloomberg data on the security). The bond market is still even to this day nothing like the stock market. Visibility & transparency (in the stock market) are your friend.
- zackangelo 13y ago
  See: Liar's Poker [1] [1] http://www.amazon.com/Liars-Poker-Michael-Lewis/dp/039333869X http://www.amazon.com/Liars-Poker-Michael-Lewis/dp/039333869...
- ISL 13y ago
  Something I think about sometimes: "In a poker game, look around the table and find the mark. If you can't, it's you." This advice, of course, ignores the second order effect that someone skilled might pretend to be a mark.... The NYT accords the quote to Billy Waters.

When companies like Tesla sells bonds, where would you buy them from? And how would you know about them being made available? (Often seems to be that once it hits the news it's all over)

joshmlewis 13y ago

Is it something you have to be an accredited investor for?

hkmurakami 13y ago
No, you can be a regular investor but you need to have an account through a major bank and have someone you can talk to who can show you their new issue inventory and make the transaction for you.
lemma 13y ago
You don't need to be accredited. The debt of a company is higher in the capital structure than its equity (creditors come before shareholders in bankruptcy), so it's a more conservative investment. That's not to say that any bond is safer than any stock, and there are plenty of bonds that are very risky (companies have credit ratings just like individuals and countries). Keep in mind also that bonds tend to have a minimum purchase size (usually $10k face value) and minimum increments thereafter ($1k usually).

hkmurakami 13y ago

Your broker at a major bank is the only place where you'd be able to buy a new offering of bonds. There's usually some minimum quantity you have to buy, in the range of $30k-$100k minimum. You basically have to ask said broker to tell you when they're available. (give you the list of new issues periodically) I think you can buy existing bonds on the market through more normal channels including discount brokerages. edit: Public Service Announcement - don't trade in bonds, because you're virtually guaranteed to get taken advantage of hardcore by Wall Street bond traders, even the "flow traders" that do the transaction for you. One example is the broker giving you a price (via the trader) that reflects the bank's own book instead of the actual open bond market (you can check the discrepancy by demanding to see the Bloomberg data on the security). The bond market is still even to this day nothing like the stock market. Visibility & transparency (in the stock market) are your friend.

zackangelo 13y ago
See: Liar's Poker [1] [1] http://www.amazon.com/Liars-Poker-Michael-Lewis/dp/039333869X http://www.amazon.com/Liars-Poker-Michael-Lewis/dp/039333869...
ISL 13y ago
Something I think about sometimes: "In a poker game, look around the table and find the mark. If you can't, it's you." This advice, of course, ignores the second order effect that someone skilled might pretend to be a mark.... The NYT accords the quote to Billy Waters.